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Rumor: Sprint to spin off Nextel

As Sprint works its way out of its doldrums, rumors predict what will happen to the carrier.

Together no more?

Rumors are swirling today over the future of Sprint. First off, Seeking Alpha is reporting that Sprint has hired Morgan Stanley for a possible spin-off of its Nextel brand. Sprint's ongoing troubles have been widely reported over the last few months and many analysts have named the 2006 merger between Sprint and Nextel as a key cause of the carrier's ongoing troubles. With that in mind, a spin-off of Nextel may be surprising, but it wouldn't be so shocking.

But that's not the only Sprint dish going around today. The Kansas City Star said that Merrill Lynch analysts are predicting that Deutsche Telekom, owner of T-Mobile USA, is considering buying Sprint. The joining of a CDMA and a GSM carrier seems a bit unlikely, but after Sprint scooped up Nextel I can believe just about anything. Yet what would seem more probable is a Verizon Wireless acquisition of Sprint. But as the Wall Street Journal points out, Verizon should just concentrate on sucking away Sprint's customers. Verizon already decided in 2004 not to buy Sprint so the Journal can't find a reason why it should try again.

In any case, Sprint needs to do something to revive its business. But what exactly should it be? What do you think? Do any of the above options sound like a good idea?